Canadian Dollar Weakens As NAFTA Talks Turn Sour
August 31 2018 - 6:17AM
RTTF2
The Canadian dollar slipped against its major counterparts in
New York deals on Friday, as talks between the US and Canada over
NAFTA failed to meet the Friday deadline set by U.S. President
Donald Trump.
Both the nations were at loggerheads regarding Chapter 19, which
would allow Canada to dispute punitive American tariffs on imports
before binational panels.
Talks between the U.S. and Canadian negotiators reached a
crucial phase this week, after the US and Mexico announced a
bilateral deal on Monday.
Sentiment soured after a report from Bloomberg said President
Donald Trump intends to move ahead with plans to impose tariffs on
$200 billion in Chinese imports as early as next week.
Citing people familiar with the matter, Bloomberg said Trump
intends to impose the tariffs after a public comment period ends
next Thursday, September 6th.
Bloomberg noted some of the people cautioned that Trump hasn't
made his final decision and may enact the tariffs in
installments.
The loonie dropped to 84.72 against the yen, its lowest since
August 22. If the loonie continues its fall, 83.00 is possibly seen
as its next support level.
Data from the Ministry of Internal Affairs and Communications
showed that overall consumer prices in the Tokyo region climbed 1.2
percent on year in August.
That beat forecasts for 1.0 percent and was up from 0.9 percent
in July. The loonie weakened to a weekly low of 1.3072 against the
greenback from yesterday's closing value of 1.2980. The loonie is
seen challenging support around the 1.32 area.
The loonie retreated to 0.9433 against the aussie, from an early
more than a 2-year high of 0.9396. On the downside, 0.97 is likely
seen as the next support level for the loonie.
Data from the Reserve Bank of Australia showed that Australia's
private sector credit increased more than expected in July.
Private sector credit climbed a seasonally adjusted 0.4 percent
month-over-month in July, following a 0.3 percent rise in June.
Economists had expected the same 0.3 percent increase for the
month.
The loonie fell back to 1.5203 against the euro, not far from
more than a 4-week low of 1.5214 hit at 3:30 am ET. Next key
support for the loonie is likely seen around the 1.54 level.
Flash data from Eurostat showed that Eurozone inflation
moderated in August from a more than five-year high level.
Inflation eased to 2 percent from 2.1 percent in July. The
annual rate was expected to remain at 2.1 percent, which was the
highest since December 2012.
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